Gaia, Inc. (NASDAQ: GAIA), a conscious media and
community company, reported financial results for the first quarter
ended March 31, 2024.
Highlights:
- Operating cash flows for the first quarter improved by $5.2
million from the year-ago quarter
- Fourth consecutive quarter of positive free cash flow
- Highest single quarter of membership growth since Q1 2021
“In the first quarter we experienced a 10% decrease in customer
acquisition costs,” said Jirka Rysavy, Gaia’s Chairman. “We
continued to see our member growth rate increase, as we doubled our
net member addition to 33,000 during the first quarter up from
16,000 in the fourth quarter, finishing with 839,000 members.”
Gaia CEO James Colquhoun commented: “As we closed the quarter,
we continued our trend of executing on cash flow positive growth
with improvements in marketing efficiency. We also re-branded our
premium membership tier from Events+ to Gaia+ and achieved the
highest one-month increase in premium members since the launch of
the premium tier in October 2019. Additionally, due to an increased
focus on direct-to-paid campaigns, annual memberships, and the new
Gaia+ tier, we increased deferred revenue on the balance sheet by
$2.0 million during the quarter.”
Gaia CFO Ned Preston commented: “During the first quarter,
revenues grew by $2.1 million or 11% year-over-year to $21.7
million. Operating cash flows for the first quarter finished at
$5.9 million, representing a $5.2 million improvement from the year
ago quarter and continues the momentum we saw closing 2023 with a
full-year increase of $4.2 million. Free cash flow for the quarter
was $1.0 million, a $1.6 million improvement from Q1 2023 and comes
after the company generated $8.4 million in full-year free cash
flow improvement during 2023.”
First Quarter 2024 Financial Results
Revenues for the first quarter grew $2.1 million or 11% to $21.7
million from $19.6 million. Member count increased 9% to 839,000
from 766,500 members as of March 31, 2023.
Gross profit in the first quarter increased to $18.5 million
from $16.9 million in the year-ago quarter.
Net loss improved to $(1.0) million, or $(0.05) per share, from
$(1.3) million, or $(0.06) per share, in the year-ago quarter.
Operating cash flows for the first quarter improved by $5.2
million from the year ago quarter, finishing at $5.9 million.
Free cash flow improved by $1.6 million to $1.0 million from
$(0.6) million in the year-ago quarter. This was our fourth
consecutive quarter with positive free cash flow.
The cash balance as of March 31, 2024, grew to $8.6 million with
an unused $10 million line of credit.
Conference CallDate: Monday, May 6, 2024Time:
4:30 p.m. Eastern time (2:30 p.m. Mountain time)Toll-free dial-in
number: 1-877-269-7751International dial-in number:
1-201-389-0908Conference ID: 13746134
Please call the conference telephone number 5-10 minutes prior
to the start time. An operator will register your name and
organization. If you have any difficulty connecting with the
conference call, please contact Gateway Group at (949)
574-3860.
The conference call will be broadcast live and available for
replay here and via ir.gaia.com.
A telephonic replay of the conference call will be available
after 7:30 p.m. Eastern time on the same day through May 27,
2024.
Toll-free replay number: 1-844-512-2921International replay
number: 1-412-317-6671Replay ID: 13746134
About Gaia Gaia is a
member-supported global video streaming service and community that
produces and curates conscious media through four primary
channels—Seeking Truth, Transformation, Alternative Healing and
Yoga—in four languages (English, Spanish, French and German) to its
members in 185 countries. Gaia’s library includes over 10,000
titles, over 88% of which is exclusive to Gaia, and approximately
75% of viewership is generated by content produced or owned by
Gaia. Gaia is available on Apple TV, iOS, Android, Roku,
Chromecast, and sold through Amazon Prime Video and Comcast
Xfinity. For more information about Gaia, visit www.gaia.com.
Forward-Looking StatementsThis
press release contains forward-looking statements within the
meaning of the federal securities laws. All statements other than
statements of historical fact are forward looking statements that
involve risks and uncertainties. When used in this discussion, we
intend the words “anticipate,” “believe,” “contemplate,”
“continue,” “could,” “estimate,” “expect,” “future,” “hope,”
“intend,” “may,” “might,” “objective,” “ongoing,” “plan,”
“potential,” “predict,” “project,” “should,” “strive,” “target,”
“will,” “would” and similar expressions as they relate to us to
identify such forward-looking statements. Our actual results could
differ materially from the results anticipated in these
forward-looking statements as a result of certain factors set forth
under “Risk Factors” and elsewhere in our filings with the U.S.
Securities and Exchange Commission, including in our Annual Report
on Form 10-K for the year ended December 31, 2023. Risks and
uncertainties that could cause actual results to differ include,
without limitation: our ability to attract new members and retain
existing members; our ability to compete effectively, including for
customer engagement with different modes of entertainment;
maintenance and expansion of devise platforms for steaming;
fluctuation in customer usage of our service; fluctuations in
quarterly operating results; service disruptions; production risks;
general economic conditions; future losses; loss of key personnel;
price changes; brand reputation; acquisitions; new initiatives we
undertake; security and information systems; legal liability for
website content; failure of third parties to provide adequate
service; future internet-related taxes; our founder’s control of
us; litigation; consumer trends; the effect of government
regulation and programs; the impact of public health threats,
including the coronavirus (COVID-19) pandemic and our response to
it; and other risks and uncertainties included in our filings with
the Securities and Exchange Commission. We caution you that no
forward-looking statement is a guarantee of future performance, and
you should not place undue reliance on these forward-looking
statements which reflect our views only as of the date of this
press release. We undertake no obligation to update any
forward-looking information.
Non-GAAP MeasuresIn addition to
disclosing financial results calculated in accordance with United
States generally accepted accounting principles (GAAP) in the
United States of America, the financial information included in
this release contains non-GAAP financial measures, including Free
Cash Flow. These non-GAAP measures should not be considered a
substitute for, or superior to, financial measures and results
calculated in accordance with GAAP, including net income, and
reconciliations to GAAP financial statements should be carefully
evaluated. Free Cash Flow represents net cash provided by operating
activities, adjusted for interest payments, and less capital
expenditures. We believe Free Cash Flow is also useful as one of
the bases for comparing the Gaia’s performance with its
competitors. Although Free Cash Flow and similar measures are
frequently used as measures of cash flows generated from operations
by other companies, Gaia’s calculation of Free Cash Flow might not
necessarily be comparable to such other similarly titled captions
of other companies. We believe that both management and investors
benefit from referring to these non-GAAP financial measures in
assessing our performance and when planning, forecasting and
analyzing future periods.
Company Contact:Ned PrestonChief Financial
OfficerGaia, Inc.Investors@gaia.com
Investor Relations:Gateway Group, Inc.Cody
Slach(949) 574-3860GAIA@gateway-grp.com
GAIA, INC.Condensed Consolidated
Balance Sheets
|
|
|
March 31, |
|
|
December 31, |
|
|
(in thousands, except share and per share
data) |
|
2024 |
|
|
2023 |
|
|
|
|
(unaudited) |
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
8,599 |
|
|
$ |
7,766 |
|
|
Restricted Cash |
|
|
4,000 |
|
|
|
— |
|
|
Accounts receivable |
|
|
4,738 |
|
|
|
4,111 |
|
|
Other receivables |
|
|
2,248 |
|
|
|
2,191 |
|
|
Prepaid expenses and other current assets |
|
|
1,875 |
|
|
|
2,015 |
|
|
Total current assets |
|
|
21,460 |
|
|
|
16,083 |
|
|
Media library, net |
|
|
39,296 |
|
|
|
40,125 |
|
|
Operating right-of-use asset, net |
|
|
6,082 |
|
|
|
6,288 |
|
|
Property and equipment, net |
|
|
25,672 |
|
|
|
26,303 |
|
|
Equity method investment |
|
|
— |
|
|
|
6,374 |
|
|
Investments and other assets, net |
|
|
9,389 |
|
|
|
3,157 |
|
|
Goodwill |
|
|
31,943 |
|
|
|
31,943 |
|
|
Total assets |
|
$ |
133,842 |
|
|
$ |
130,273 |
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
Accounts payable |
|
$ |
11,368 |
|
|
$ |
12,038 |
|
|
Accrued and other liabilities |
|
|
5,734 |
|
|
|
2,599 |
|
|
Long-term debt, current portion |
|
|
156 |
|
|
|
155 |
|
|
Operating lease liability, current portion |
|
|
795 |
|
|
|
780 |
|
|
Deferred revenue |
|
|
17,815 |
|
|
|
15,861 |
|
|
Total current liabilities |
|
|
35,868 |
|
|
|
31,433 |
|
|
Long-term debt, net of current portion |
|
|
5,762 |
|
|
|
5,801 |
|
|
Operating lease liability, net of current portion |
|
|
5,503 |
|
|
|
5,708 |
|
|
Deferred taxes, net |
|
|
551 |
|
|
|
551 |
|
|
Total liabilities |
|
|
47,684 |
|
|
|
43,493 |
|
|
Equity: |
|
|
|
|
|
|
|
Gaia, Inc. shareholders’ equity: |
|
|
|
|
|
|
|
Class A common stock, $0.0001 par value, 150,000,000 shares
authorized, 17,825,513 and 17,813,179 shares issued, 17,760,708 and
17,748,374 shares outstanding at March 31, 2024 and December
31, 2023, respectively |
|
|
2 |
|
|
|
2 |
|
|
Class B common stock, $0.0001 par value, 50,000,000 shares
authorized, 5,400,000 shares issued and outstanding at March 31,
2024 and December 31, 2023, respectively |
|
|
1 |
|
|
|
1 |
|
|
Additional paid-in capital |
|
|
171,044 |
|
|
|
170,695 |
|
|
Accumulated deficit |
|
|
(86,240 |
) |
|
|
(85,195 |
) |
|
Total shareholders' equity |
|
|
84,807 |
|
|
|
85,503 |
|
|
Noncontrolling interests |
|
|
1,351 |
|
|
|
1,277 |
|
|
Total equity |
|
|
86,158 |
|
|
|
86,780 |
|
|
Total liabilities and shareholders' equity |
|
$ |
133,842 |
|
|
$ |
130,273 |
|
GAIA, INC.Condensed Consolidated
Statements of Operations (unaudited)
|
|
|
For the Three Months Ended March 31, |
|
|
(in thousands, except per share data) |
|
2024 |
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
Revenues, net |
|
$ |
21,693 |
|
|
$ |
19,647 |
|
|
Cost of revenues |
|
|
3,168 |
|
|
|
2,773 |
|
|
Gross profit |
|
|
18,525 |
|
|
|
16,874 |
|
|
Gross margin |
|
|
85.4 |
% |
|
|
85.9 |
% |
|
Expenses: |
|
|
|
|
|
|
|
Selling and operating |
|
|
17,759 |
|
|
|
16,123 |
|
|
Corporate, general and administration |
|
|
1,629 |
|
|
|
1,773 |
|
|
Total operating expenses |
|
|
19,388 |
|
|
|
17,896 |
|
|
Loss from operations |
|
|
(863 |
) |
|
|
(1,022 |
) |
|
Equity method investment loss |
|
|
— |
|
|
|
(125 |
) |
|
Interest and other expense, net |
|
|
(108 |
) |
|
|
(121 |
) |
|
Loss before income taxes |
|
|
(971 |
) |
|
|
(1,268 |
) |
|
Provision for income taxes |
|
|
— |
|
|
|
— |
|
| Net
loss |
|
|
(971 |
) |
|
|
(1,268 |
) |
| Net
income attributable to noncontrolling interests |
|
|
74 |
|
|
|
38 |
|
| Net
loss attributable to common shareholders |
|
$ |
(1,045 |
) |
|
$ |
(1,306 |
) |
|
|
|
|
|
|
|
|
|
Loss per share: |
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
Continuing operations |
|
$ |
(0.05 |
) |
|
$ |
(0.06 |
) |
|
Discontinued operations |
|
$ |
— |
|
|
$ |
— |
|
|
Loss per share |
|
$ |
(0.05 |
) |
|
$ |
(0.06 |
) |
|
Diluted |
|
|
|
|
|
|
|
Continuing operations |
|
$ |
(0.05 |
) |
|
$ |
(0.06 |
) |
|
Discontinued operations |
|
|
— |
|
|
|
— |
|
|
Diluted loss per share |
|
$ |
(0.05 |
) |
|
$ |
(0.06 |
) |
|
Weighted-average shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
|
23,161 |
|
|
|
20,826 |
|
|
Diluted |
|
|
23,161 |
|
|
|
20,826 |
|
GAIA, INC.Condensed Consolidated
Statement of Cash Flows (unaudited)
|
|
|
For the Three Months Ended March 31, |
|
|
(in thousands) |
|
2024 |
|
|
2023 |
|
|
|
|
|
|
| Net
cash provided by (used in): |
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
|
5,936 |
|
|
|
686 |
|
|
Net cash used in investing activities |
|
|
(1,073 |
) |
|
|
(1,418 |
) |
|
Net cash (used in) provided by financing activities |
|
|
(30 |
) |
|
|
18 |
|
| Net
change in cash, cash equivalents, and restricted cash |
|
$ |
4,833 |
|
|
$ |
(714 |
) |
Reconciliation of Net Cash Provided by Operating
Activities to Free Cash Flow (unaudited)
|
|
|
For the Three Months Ended March 31, |
|
|
(in thousands) |
|
2024 |
|
|
2023 |
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
$ |
5,936 |
|
|
$ |
686 |
|
|
Cash paid for interest |
|
|
108 |
|
|
|
125 |
|
|
Net cash used in investing activities |
|
|
(1,073 |
) |
|
|
(1,418 |
) |
|
Restricted cash |
|
|
(4,000 |
) |
|
|
— |
|
|
Free cash flow |
|
$ |
971 |
|
|
$ |
(607 |
) |
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